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Igor Yakovets: “We have found three interesting projects in Lviv”

On March 19, Lviv hosted the Startup Garden Conference. Igor Yakovets, Communications Director, represented Digital Future there. He spoke on the topic that is traditional for us – the smart money and its use for the IT startups. Here is the story of what happened in Lviv.

– What were the objectives of this conference, and were they accomplished?

– Lviv’ IT community is developing and is very different from the communities in Kyiv, Dnipropetrovsk or Odesa. It is interesting to observe this community and help the local projects that are doing something new, something oriented to the global markets.

In this regard, a goal of participating in the Startup Garden is accomplished 100%. We have found, at least, three projects that do interesting things, they have the traction, and they are in our focus. We plan to continue our discussion. It is possible that over time, this dialogue will result in a real agreement or investment.

It was interesting to see how one of the teams developed the project on the topic we do not particularly like (First, it is targeted at the local market. Secondly, it is tied to physical goods), did the pivot, ended up with a pure software solution, which has the global potential. The peculiarity is that the project’s sphere of interest lies in the veterinary medicine.

Another interesting episode was the pitch of the team that develops the framework for the IoT. We are talking about a set of technologies that enables the developers in the sphere of IoT to create the working solutions from the premade components, and not to hand-code it themselves. In this way, people can answer the question “what this product should do” and not “how this product should work.”

– How did you find these teams?

– In a standard way, as on any similar event. You do the presentation, and the people talk to you afterward about their projects. These people approached me in the same manner, asking for my opinion on their projects. It is still early to say something specific because it is hard to evaluate the startups after the 10-minute discussion. However, there are some ideas.

– What are your impressions about Lviv? Does the myth about Lviv as the city for the outsourcers and not the producers has any merits? It is often said that Lviv is the capital of Ukrainian outsource.

– I would not say that there are that many outsourcers in Lviv, in comparison to other cities. Not that it is a bad thing, anyway.

Judging by the audience of the Startup Garden, I can say that many people do not do their startups because of the lack of knowledge. However, it is a pleasing thought that they come to these kinds of activities to listen and learn. Such kind of outsourcers is the driving force for the startups when they decide to realize themselves as the developers of a solution, business or product.

In other words, it is very good that there were outsourcers on this conference because thanks to them the entire ecosystem will continue to grow.

Innotech Ukraine: a Report

On March 11-12, Kyiv hosted the Innotech Ukraine Conference.

The Leading Investment Manager of Digital Future Viktor Kompaneyets participated in the Conference and gathered the most interesting facts:

– On the Speed Dealing tandem:

– In the Speed Dealing section, the investors have listened to the short pitches from 30 teams for three hours. Almost like the Speed Dating. J

During the Conference, Viktor has worked with Andriy Krivorchuk, the Managing Partner of Chernovetskyi Investment Group (CIG).

“It was an interesting tandem. We have a long and fruitful history of cooperation with CIG, we have the same approach to the things, so we understood each other without even talking,” said Viktor.

– On the Araned:

– There were only three worthy projects among those 30. Two of them were from last year, by the way.

“There was a fantastic one, though. I am following them for some time, and try to help them from our side. They have impressed Andriy too, in such a way that he agreed to help them.

It is a medical project called Araned. Araned is a medical education solution, which combines 3D printing with augmented reality. For example, you can see the 3D models of the bones in the mobile app, you can see all the tissues, nerves, vessels and other anatomical structures,” explained Viktor.

He is sure that the team is preparing a truly disruptive technology. They have reached tremendous progress, without attracting significant resources in the last year. The startup was also incubated abroad.

“Unfortunately, we don’t have any suitable incubators for this project. I suppose, Araned will leave Ukraine. It has the bright future with the right approach,” said Viktor.

– On the scale of the conference:

– In general, after participating in the events like MWC in Barcelona, the scale on the Innotech Ukraine seemed so small.

“The same 3D printers, drones, robots. Everything we had last year, but on a smaller scale,” Viktor complains. The last years’ conference was bigger.

Digital Future and WannaBiz Invest $400K in Reply.io

Investment Company Digital Future invests $350k in Replyapp.io, an instrument for sending the “cold” emails. WannaBiz joins the offer with $50k.

Replyapp.io is the system that enables the automation of the personalized emails. Every letter sent through the system looks like it was written in person, and not by the regular email robot.

Replyapp.io is designed for the sales managers to be used for sending the so-called “cold” emails (when reaching out to the client for the first time). Also, the system can automate the process of sending the “warm” emails (when there is a dialogue with the client).

“In the past six months, our sales increased by 30-50% per month. While we were at the interview with 500 Startup and Y Combinator, we could continue to grow on the revenue generated from the clients. Right now, our market is very hot and competitive, that is why, if we want to retain our positions, we need to work 10 times faster. It would not be wise to wait for our revenue to rise, so that we expand without the investments, on our own,” says the founder of Replyapp.io Oleg Belozor.

CEO of Digital Future, Oleksii Vitchenko told that it was that rare occasion when the investor got interested in the startup, and not vice versa.

“We quickly understood the value of this startup, after our portfolio companies The App Solutions (development of mobile apps) and Digital Bee (digital marketing agency) have battle tested this service. We understood that the service works better than the similar services in this niche. This instrument gave us the opportunity to automate the work our sellers. The improvement came in the outbound-sales when the potential client knows nothing about the seller, as well as in the inbound-sales when we communicate with the clients that left the contact information on the website,” explained Oleksii Vitchenko.

“B2B sector is now going through the repetition of the cycle. Inbound-marketing, which came into place instead of the “cold” calls, is not so popular now, because the Internet is oversaturated with the content, and the competition in the inbound only grows. Right now, the direct sales supersede the inbound-marketing. Targeted personal emails provide an opportunity to build a stable and predictable sales funnel, and consequently, increase the sales several times,” said Oleg Belozor.

According to Oleksii Vitchenko, Digital Future presented the investment proposal over a year ago, but at that time, Oleg Belozor had no vision on how this money can help with the development of business, therefore, the decision not to hurry. However, after the SaaStr conference in San Francisco, Oleg understood the best way to utilize the investment to speed up the growth process.

While at the Silicon Valley, Oleg was acquainted with Artem Borodatiuk, the cofounder of WannaBiz.

“We talked a lot with Oleg on the development of SaaS-products,” comments Artem Borodatiuk, “I like his ambitions, attention to details, and focus on business development. Besides, the project fit our strict criteria: the quick growth of MRR, focus on the USA, etc. That is why we joined efforts on this deal. The check in not that big, only $50k, but the value of this deal is that three founders of WannaBiz are experienced entrepreneurs.”

The investments will be directed at expanding the sales, marketing, and product development.

“We believe in these guys so much, that we offered more money than they originally asked for, not $200-250k, but $400k. We believe that they need to grow faster, because the competitiveness levels increase in the US, and they need the time to hop on the train,” said Oleksii Vitchenko.

Digital Future invests not just money, but the Smart Money. In the case of the Replyapp.io, this will be the expertise in product biz dev, marketing, and recommendations from the users of the service.

“We have the experience in building the product driven campaigns, and we know how to boost the sales,” said Oleksii.

Digital Future (www.digital-future.org) – is an investment company, which funds the startups from Eastern and Central Europe with the Smart Money. Founded in 2014. Oleksii Vitchenko is the CEO, with the years of experience as the serial entrepreneur.

WannaBiz (www.wannabiz.com.ua) – is a fund oriented on the projects that have passed the Seed funding stage, with the focus on Western markets, and with the steady revenue raise. Sphere of interests includes adtech and b2b SaaS. Three entrepreneurs, Vadim Rogovskyi, Aleksandr Borniakov and Artem Borodatiuk, founded Wannabiz.

Replyapp.io (http://replyapp.io) – is a service for the sales managers aimed at automation of “cold” emails. Founded in August of 2014, the first release happened in June 2015. Oleg Belozor is the founder.

Digital Future will attend the Battle of Startups in Odessa

On April 1, Odessa will host the Battle of Startups.

The CEO Oleksii Vitchenko will represent Digital Future.

This is the 38th Startup Battle that is hosted by the investment platform Startup.Network. The event is held on a monthly basis.

Two sessions are planned in the framework of this battle:

  • From 17.00 to 18.00 – the entrepreneurial block. Here experienced entrepreneurs will share the experience and the last trends in the industry with their young colleagues.
  • From 18.00 to 20.00 – the investor’s block “Presentations of startup projects.” Different projects will make the 3-minute presentations before the expert council. After that, the experts of the Battle of Startups will question the entrepreneurs and will give advice on the projects.

You can present your project free of charge, but registration is required.

Please click here to register.

See you in Odessa!

Digital Future AI Hackathon

On Mach 3, we held the first Meetup dedicated to the preparation to the AI Hackathon. We would like to share a few details with you.

The Hackathon will take place on April 15-17 in the framework of the Kyiv Startup Week and will last for 48 hours.

During the AI Hackathon, we would like to see the formation of new teams and ideas with the possible investment into the best of them.

A few details:

  • The teams will be formed on site;
  • The team can be up to six people (marketers, sales people, designers, communications specialists (PR), entrepreneurs, etc.).

Of course, we are talking about the systems with the elements of the AI in Media, AdTech, E-commerce or Lifestyle.

Agenda:

  • Friday – Pitch of ideas (30-60 seconds for the pitch), team creation.
  • From Friday to Saturday, the team must find a way to test the idea in the target market and get an answer from the representative of the target market, for example, speak to a potential client of foreign markets (it will be a proper time for business communications in the US).
  • 12:00 Saturday – checkpoint. Here the mentors will provide the feedback.
  • 19:00 Saturday – checkpoint. Only the teams, who passed this checkpoint, will participate in the final presentation on Sunday.
  • Sunday – Help from the mentors on the preparation of the pitch.
  • 15:00 Sunday – The Final Presentation.

We understand the complexity of the implementation of the project within 48 hours and do not expect the finished product. However, the mechanisms of implementation of the product should be demonstrated during the final presentation. The fundamental question – to confirm the viability of the idea of the target market.

The jury, which will include the investors, will evaluate the projects on their potential investment attractiveness.

Anticipating the hot issues, we can say that the top prize has not yet been determined. We will also announce the composition of jury and mentors a bit later. On March 15, we will open the registration for everyone.

Still, we are open to your suggestions on organizing this event. We do welcome the sponsors!

If you have any question, please contact Karina Kalina on Facebook, or by email at [email protected].

Master Class by Roman Gold, a Brief Report

“An hour for the speech, two for the dialogue,” says Roman Gold about his master class in the co-working space of Digital Future. In addition, he said that this is a record in the ratio of the speech length to the Q&A session.

Roman was talking about Israeli startup ecosystem, approaches to investing, and peculiarities of friendship between the market players.

Israeli realities are like a dream to Ukraine, millions of investments in the early stages, an abundance of the accelerators and incubators, complex technological solutions and close cooperation with the US companies.

An example, Ukrainian startup raises $200-250k in the Round “A” and this the norm, while the Israeli norm is around a few millions. The Israeli startup Gett (the app to order a cab) attracts $300-400 million in the next round of financing.

In general, during 2015, the number of Israeli startups has increased by 1600 and now equals 6000.

Recently, Oracle has absorbed the Israeli startup Ravello for $500 million.

The total number of exits exceeded 100 last year, and the sum reached $9 billion.

The full picture of the achievements of the Israeli industry of innovations in 2015 is reflected in the infographic prepared by IT Business Week.

Can Ukraine achieve the similar results? Right now Israeli startups are more mature. It is pointless to compare the ecosystems right now the drift is too big. “Israeli startup market is full of high-quality projects to such extent, that being in the general incubator is considered immature by the investors,” said Roman in the interview to the Thinking Investor.

Ukraine can achieve the success, and “Should not limit itself to copying the ways of other states,” says Roman.

However, let us get back to the master class and say a few words about the audience. The fact that Q&A session lasted for two hours indicates that people, who gathered were ready for the constructive and professional dialogue.

It was not the first event in the sphere of investment in the IT sector for Digital Future. Oleksii Vitchenko, CEO of Digital Future held his master class a week ago, and there are many planned events for this spring.

So watch out for our announcements!